national council for higher education...

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NATIONAL COUNCIL FOR HIGHER EDUCATION (NCHE)

SKILLS DEVELOPMENT PROJECT

IDA PROJECT NO: Pl31660

FINANCIAL STATEMENT

30 JUNE 2016

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NATIONAL COUNCIL FOR HIGHER EDUCATION (NCHE) SKILLS DEVELOPMENT PROJECT

IDA CREDIT NO: Q8920

FINANCIAL STATEMENT FOR THE YEAR ENDED 30 JUNE 2016

CONTENTS

Statement of management responsibilities

Audit summary

Statement of receipts and payments

Auditor's report


Statement of financial position

Statement of Activity on the Designated Account

Notes to the statement of receipts and payments

Internal controls

Auditor' s report

Compliance with agreement terms

Auditor' s report

Appendices

Appendix I - Detailed income and expenditure statement

Appendix II - Fixed asset register

Page

2-6

7-8

9

10

11

12 - 15

16

17

18

19-24


IDA PROJECT NO: P131660

STATEMENT OF MANAGEMENT RESPONSIBILITIES FOR THE YEAR ENDED 30 JUNE 2016

The management of the Skills Development Project is required to prepare statement of receipts and payments for each financial year which give a true and fair view of the state of affairs of the project as at the end of the financial year and of the operating results for that year.

The management are also required to ensure that the project keeps proper accounting records which disclose with reasonable accuracy at any time the financial position of the project and enable them to ensure that the statement of receipts and payments comply with the financial agreements and statutes.

In preparing the statement of receipts and payments the management accept responsibility for the following:

• maintenance of proper accounting records; • selection of suitable accounting policies and applying them consistently; • making judgment and estimates that are reasonable and prudent; • compliance with applicable accounting standards when preparing statement of receipts and

payments, subject to any material departures being disclosed and explained in the statement of receipts and payments ;

• preparation of statement of receipts and payments on a going concern basis.

The management also accepts responsibility for taking such steps as are reasonably open to them to safeguard the assets of the project and to maintain adequate systems of internal controls to prevent and detect fraud and other irregularities.

The management are of the opinion that the statement of receipts and payments give a true and fair view of the state of the financial affairs of the project and of its operating results.

The statement of receipts and payments have been approved by the Board on.3:.f P. .(.ltr.. .... and are signed on its behalf by:

COUNCIL CHAIRPERSON ~?CHIEF EXECUTIVE OFFICER

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IDA PROJECT NO: Pl31660

STATEMENT OF RECEIPTS AND PAYMENTS FOR THE YEAR ENDED 30 JUNE 2016

AUDIT SUMMARY

Background and project identification

The National Council for Higher Education (NCHE) is implementing the Malawi Government Skills Development Project (SDP), project no . Pl 31660, with support the World Bank. The SDP is implemented in selected public higher education institutions. They are :

• University of Malawi - The Polytechnic (POLY) • University of Malawi - Chancellor College (CHANCO) • Mzuzu University (MZUNI) • Lilongwe University of Agriculture and Natural Resources (LUANAR) • Technical , Entrepreneurial and Vocational Education and Training Authority (TEVETA)

The National Council for Higher Education was established by Act of Parliament No. 15 of 2011 , with the primary purpose of providing accreditation and quality assurance services in higher education institutions in Malawi. Its mission is to promote and coordinate relevant, accessible, equitable, sustainable quality higher education in Malawi through accreditation, quality assurance policy support and planning and representation of Malawi's higher education interest nationally and internationally.

The project became effective on 11th May 2015, ten months after signing the financial agreement, and is expected to end on 301h June 2019. The key guiding project documents are: The Project Appraisal Document (PAD), Financial Agreement (FA), Sub-Project Grant Agreement (SPGA) and Project Implementation Manual (PIM), among others.

Project Objective

The SOP aims to equip the primary beneficiaries - the students/trainees - with applicable skills in the society. It is hoped that the primary beneficiaries will be able to use the skills they will acquire for their livelihood and improve their general welfare either by getting employed or being selfemployed and/or creating jobs for others. The Project Development Objective (PDQ) statement of the SDP is : to increase access, market relevance and results orientation of supported skills development institutions in agreed priority areas.

The project aims to equip its primary Direct Beneficiaries, i.e. the students I trainees, with skills needed in the Jabour market. By scaling up training of semi-skilled persons and expanding skilling opportunities for the currently underserved groups including rural communities and school dropouts from poor families , it is hoped that the project will work towards eradicating extreme poverty and promoting shared prosperity either through self- employment or salaried jobs which will guarantee regular income for the beneficiaries. It is further hoped that the improved income levels of the primary beneficiaries will contribute to the country's economic growth.

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ST A TEMENT OF RECEIPTS AND PAYMENTS FOR THE YEAR ENDED 30 JUNE 2016

AUDIT SUMMARY (CONTINUED)

The project consists of two components. Component 1 involves supporting participating institutions (Pls) in implementing Sub-Project Grant Agreements (SPGA). Through this component, the Pls are assisted in their strategic interventions in order to " increase access, market relevance, and results orientation in agreed priority areas" .

In this regard, the Pis are assisted through construction and rehabilitation of infrastructure, supply of equipment, development of new programs and strengthening of staff capacity to deliver the programs. In addition to these, MZUNI and LUANAR are both assisted through establishment of open and distance learning (ODL) centres and setting up of satellite centres at Karonga and Lilongwe TTCs and at Mulanje and Balaka secondary schools for MZUNI and in Mzuzu and Blantyre for LUANAR.

For its part, TEVETA is assisted through training of master craftsmen, supplying of equipment, training of staff in selected institutions offering informal sector training in rural areas and in selected institutions offering technician level programs.

In Component 2, the focus is on systems strengthening and policy reforms. It consists of carrying out a program of activities to strengthen the capacity of the National Council for Higher Education (NCHE) in Project planning, implementation, coordination, reporting, monitoring and evaluation and fiduciary management as well as provision of equipment. NCHE is mandated to regulate and coordinate higher education in Malawi.

Audit objective

The objective of the audit of the project statement of receipts and payments as set out in the Terms of Reference for the Assignment issued by National Council for Higher Education is to

• Enable the auditor to express an independent professional opinion on the financial position of the project as at the end of the financial year;

• Ensure that the funds granted to the project have been used for the intended purposes;

• Ensure that the project books of accounts provide the basis for the preparation of the project statement of receipts and payments and are established to reflect the financial transactions in respect of the project;

• Ensure that adequate internal controls and supporting documentation for transactions are maintained.

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Audit scope

Our audit was carried out in accordance with the International Standards on Auditing. It included such tests as we considered necessary to enable us to obtain reasonable assurance on whether:-

(a) All Bank funds have been used in accordance with the conditions of the financing agreement with due attention to economy and efficiency and only for the purposes for which they were provided;

b) Counterpart fund (government budget) and external funds (in case of co-financing) have been provided and used in accordance with the conditions of the financing agreement, with due attention to economy and efficiency and only for the purposes for which they were provided;

(c) Goods, works and services financed have been procured in accordance with the financing agreement and in accordance with Bank's rules and procedures and have been properly accounted for ;

(d) Appropriate supporting documents, records and books of accounts relating to all project activities have been kept. Clear linkages should exist between the books of account and the statement of receipts and payments presented to the Bank;

(e) Special accounts have been maintained in accordance with the provisions of the financing agreement and in accordance with the bank's disbursement rules and procedures;

(f) The statement of receipts and payments have been prepared by project management in accordance with applicable accounting standards and give a true and fair view of the financial position of the project as at the year end and of its receipts and expenditures for the year ended on that date;

(g) Comprehensive assessment of the adequacy and effectiveness of the accounting and overall internal control system to monitor expenditures and other financial transactions and ensure safe custody of project-financed assets and that they are being used for the intended purposes;

(h) Project's fixed assets are real and properly evaluated and project property rights or related beneficiaries ' rights are established in accordance with financing conditions; and

(i) Ineligible expenditures identified during the audit be reflected in a separate paragraph of the audit report and if material, the point be reflected in the auditors' opinion.

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Pre-audit steps

• Familiarization with project' s records in respect of the following;

Project statement of receipts and payments

• Examination of the project statement of receipts and payments including budgeted amounts by category;

• For expenditure, examination of source documents, verification of adequate authorization and verification that expenditure was allowable under the purposes for which the financing was provided;

• Review of accounting records and ensuring that these have been maintained in accordance with Internationally accepted principles hereunder, that Skills Development Project has kept adequate records of the cash and bank transactions;

• The conversion of one currency to another has been supported by an official receipt from the bank or an official exchange institution, stating the exchange rate;

• Review of procurement procedures to ensure that they are in accordance with the Financing agreement and the Bank's rules and procedures.

Internal control

• Obtaining a sufficient understanding of the internal control structure to plan the audit and determine the nature, timing and extent of tests to be performed;

• Documentation and evaluation of the control environment, the accounting system and the control procedures;

• Assessment of control risk, that is the effectiveness of the internal control structure, policies and procedures of the Project in preventing or detecting material misstatements in the statement of receipts and payments;

Compliance with.financing agreement terms

• Identification of the agreement terms and determination of those which if not observed could have a material effect on the statement of receipts and payments;

• Assessment of each material requirements and the risks that non-compliance could occur;

• Design of audit steps and procedures to test for errors, irregularities, and illegal acts that provide reasonable assurance of detecting instances of non-compliance;

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• For all payments, verifying that they have been made in accordance with agreement tenns and applicable regulations;

• Verifying that expenditure by category was within the approved categories and the approved list of goods and services;

• Detennination that counterpart funds have been provided and expended in accordance with the relevant agreement;

• Determination that the statement of receipts and payments are supported by the books and records from which the statement of receipts and payments are prepared;

• Assessment of the physical status of implementation of the project components in relation to the level of disbursement made so far against the targets as set out in the Appraisal Report.

Special account

There is no special account since all payments are made through direct payments method.

Skills Development Project management did not prevent us from conducting any tests and procedures deemed necessary to fonn a reasonable basis for our opinion.

Audit results


In our opinion, the statement of receipts and payments, give, in all material respect, a true and fair view of the financial position of the project as of 30 June 2016 and of its receipts and expenditures for the year then ended in accordance with the financing agreement and the bank rules and regulations.

Internal control

In our opinion, internal controls were adequate for the year.

Compliance with agreement terms

In our opinion, the bank's disbursement rules and procedures were complied with during the year under review.

Special account

There are no special account to be audited since the payment is direct disbursement by the Bank.

Please do not hesitate to contact us shou ld you require any further infonnation or clarification.

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•• GRAHAM CARRI I Chartered Accountants

~ Ne;ii ~ International

AUDITOR'S REPORT TO NATIONAL COUNCIL FOR HIGHER EDUCATION

SKILLS DEVELOPMENT PROJECT


Scope

We have audited the statement of receipts and payments of Skills Development Project under International Development Association Financing No Pl3 l 660 for the year ended 30 June 2016.

Management's responsibility for the statement of receipts and payments

Management is responsible for the preparation and fair presentation of the statement of receipts and payments in accordance with the International Public Sector Accounting Standards, in a manner required by the International Development Association Disbursement Handbook, and for such internal controls as the management determine is necessary to enable the preparation of statement of receipts and payments that are free from material misstatement, whether due to fraud or error.

Auditor's responsibility Our responsibility is to express an opinion on the statement of receipts and payments based on our audit. We conducted our audit in accordance with International Standards on Auditing and International Development Association ' s terms of reference pertaining to external audit. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the statement of receipts and payments is free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the statement of receipts and payments. The procedures selected depend on the auditor ' s judgment, including the assessment of the risks of material misstatement of the statement of receipts and payments, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the statement of receipts and payments in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the statement of receipts and payments.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

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I ADL House, 2"d Floor, City Centre I P.O.Box 898 Lilongwe Malawi

Tel: (+265) 01 775 763 I 01 775 764 I 01 775 836, Fax: 01 775 763, E-mail: [email protected] Nexia International is a worldwide network of independent auditors , business advisors and consultants

Partners: C.M.C Banda-Lilongwe, D. Ngwira(Mrs)-Blantyre. Offices in Lilongwe and Blantyre.

t

•• GRAHAM CARRI I

Chanered Accountan1s A member of

Nexia International

Opinion

In our opinion:

a) World Bank financing has been used in accordance with the conditions of the relevant financing agreement, with due attention to economy and efficiency and only for the purposes for which the financing was provided;

b) Goods, works and Services financed have been procured in accordance with the financing agreements including specific provisions of the World Bank Procurement policies and procedures;

c) All necessary supporting documents, records and accounts have been maintained in respect of all project activities, including expenditures reported using Statements of Expenditure (SOE) methods of reporting.

e) Designated Accounts have been maintained in accordance with the prov1s10ns of the financing agreements and funds disbursed out of the accounts were used only for the purpose intended in the financing agreement;

f) National laws and regulations have been complied with that the financial and accosting procedures approved for the project were followed and used for the year ended 30 June 2016;

g) Financial performance of the project is satisfactory;

h) Assets procured from project funds exist and there is verifiable ownership by NCHE or beneficiaries in line with the financing agreement; and

i) There were no ineligible expenditures in the year under review.

Graham Carr 3rd January 2017

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NATIONAL COUNCIL FOR HIGHER EDUCATION (NCHE) ON BEHALF OF MALA WI GOVERNMENT SKILLS DEVELOPMENT PROJECT IDA PROJECT Pl31660


NOTE 2016 MK'OOO

Sources of Funds

IDA Credit No P 131660 App.I 1,095,789 Interest received 4,737 Exchange gains 256,462

Total funds 1,356,988

Uses of Funds:

Goods, non consulting services,cosulting sevices, training and opeating costs for part App.I 377,086

Capital expenditure 643 , 175

Total uses of funds 1,020,261

Surplus of receipts over disbursements 336,727

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2016 USD

1,957,723 6,941

1,964,664

570,660

942,329

1,512,989

451,675

2015 USD

770,262 955

771,217

428,619

162,801

591 ,420

179,797


STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2016

2016 Notes MK'OOO

Assets

Non current assets Property, plant and equipment 4 649,211

Current assets Cash & cash equivalents 5 441, 126 Receivables 6 4,873

Total assets 1,095,210

Funds/liabilities

Funds Restricted fund 407,180 Capital fund 649,211

1,056,391

Current liabilities Bank overdrafts 4 59 Payables 6 38,760

Total liabilities 38,819

Total funds and liabilities 1,095,210

2016 USD

910,332

618,552 6,834

1,535,718

570,954 910,332

1,481,286

83 54,349

54,432

1,535,718

2015 USO

119,144

35,674 33,971

188,789

60,653 119, 144

179,797

8,992

8,992

188,789

The financial statements have been approved Board on . . ~!?.(. /Ir ....... and are signed on its behalf by:

COUNCIL CHAIRPERSON

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,.

NATIONAL COUNCIL FOR HIGHER EDUCATION (NCHE) ON BEHALF OF MALA WI GOVERNMENT SKILLS DEVELOPMENT PROJECT IDA PROJECT P131660

STATEMENT OF ACTIVITY IN THE DESIGNATED ACCOUNT FOR THE YEAR ENDED 30 JUNE 2016

IDA Credit No. Q8920

Account No. 14253181 Part I

Deposit Bank: NBS Bank

1 Cumulative advances to end of current reporting period

2 Cumulative expenditures to end of last reporting period

3 Outstanding advance to be accounted for (line 1 minus line 2)

Part II 4 Opening DA balance at beginning ofreporting period (as of beginning of quarter)

5 Add/Subtract: Cumulative Adjustments (if any)

6 Advances from World Bank during period

7 Add lines 5 and 6

8 Outstaning balances to be accounted for ( add lines 4 and 7)

9 Closing DA balance at end of current reporting period (as of quarter)

10 Add/Subtract: Cumulative adjustments

11 Expenditures for current reporting period

12 Add lines 10 and 11

13 Add lines 9 and 12

14 Difference (if any) (line 8 less line 13)

Part III 15 Total forecasted amount to be paid by World Bank

16 Less: Closing DA balance after adjustments

17 Direct payments/Special Commitments 18 Add lines 16 and 17

19 Cash requirement from World bank for next two reporting period (line 15 less

line 18)

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Currency USD

2,727,940

2,110,470

617,470

1,546,280

6,941

6,941

1,553,221

618,470

934,751

934,751

1,553,221

853,952

618,470

618,470

235,482

• NATIONAL COUNCIL FOR HIGHER EDUCATION (NCHE) ON BEHALF OF MALA WI GOVERNMENT SKILLS DEVELOPMENT PROJECT IDA PROJECT P131660

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2016

1 BASIS OF PREP ARA TIO NS

(a) Statement of compliance

The financial statement have been prepared in accordance with the International Financial Report Standards adopted for use in Malawi, provisions of the projects objectives, the World Bank guidelines and terms and conditions of IDA Project no.Pl 3160

(b) Basis of measurement

The financial statements are prepared on the historical cost basis.

( c) Functional and presentation currency

The financial statements have been presented in Malawi K wacha, which is the project functional currency and United States Dollar.

2 SIGNIFICANT ACCOUNTING POCILIES

A summary of significant policies underlying the preparation of the Project's financial statement is prepared below;

(a) Income

Income consists of funding received from World Bank under IDA Project no.Pl31660 Income generated from the funds will not be restricted income. Income is recognised when funds are received and subject to the conditions of the grant agreement.

Other revenues: Interest earned on deposits are recognised in the period in which they are received.

Exchange gains: The exchange gains are realised from conversions rates differences and are recognised in the year they incurred.

(b) Cash and cash equivalent

Cash and cash equivalents consists of cash in hand and bank balances.

( c ) Transactions in foreign currencies

The SDP Project maintains books in Malawi Kwacha (MK) and United States Dollars. Transactions are translated at the rate of exchange ruling on the date of transactions.

The United State Dollar exchange rate and inflation rate as at 30 June 2016 were as follows;

Kwacha /US Dollar 713.16 Inflation rate 22.6%

The United States Dollar exchange rate and inflation rate as at the date of signing the project financial statement were as follows;

K wacha /US Dollar Inflation rate

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NOTES TO THE FINANCIAL STATEMENTS ( CONTINUED) FOR THE YEAR ENDED 30 JUNE 2016

SIGNIFICANT ACCOUNTING POLICIES ( CONTINUED)

(d) Property, plant & equipment

Initial recognition

Items of property & equipment are stated at cost less accumulated depreciation and impairment losses.

ii Subsequent expenditure

Expenditure incurred to replace a component of an item of property or equipment that is accounted for separately, including major inspection and overhaul expenditure, is capitalised. Other subsequent expenditure is capitalised only when it increases the future economic benefit embodied in the item of property or equipment. All other expenditure is recognised in the Statement of Sources and Uses of Funds as an expense when incurred.

iii Depreciation

All property and equipment will be depreciated on a straight line basis. The rates used are as follows : Motor Vehicles 20% Office equipment Furniture & fittings ICT equipment Buildings

10% 10% 33%

3%

(e) Income tax

NCHE -SDP project is exempt from tax according to 1st schedule, subsection 4 of the Taxation Act, as it is non-profit making.

3 FUNDING

Date Details

28/08/15 World Bank

Amount

MK'OOO

1,095,789

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Amount

USD

1,957,723

- -NATIONAL COUNCIL FOR HIGHER EDUCATION (NCHE) ON BEHALF OF MALA WI GOVERNMENT SKILL DEVELOPMENT PROJECT IDA PROJECT P131660

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 30 JUNE 2016

4 PROPERTY, PLANT AND EQUIPMENT Buildings Plant

equipment

MK MK Cost

As at 01/06/15 Additions

As at 30/06/16

Additions 562,875 455

As at 30/06/16 562,875 455

Depreciation

As at O 1/06/15 Charge for the year

As at 30/06/16

1 Charge for the year 13,368 43

As at 30/06/16 13,368 43

L Carrying amounts

At 30/06/16 549,507 412

As at O 1/06/15

Motor vehicle

MK

33,824

33,824

55,895

89,719

6,765

6,765 16,709

23,474

66,245

27,059

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Office ICT Total furniture & equipment

fittings accessories MK MK MK

38,093 71 ,9 17

38,093 71 ,917

12,243 11 ,707 643,175

12,243 49,800 715,092

12,571 19,336

12,571 19,336 1,163 15,262 46,545

1,163 27,833 65,881

11,080 21,967 649,211

25,522 52,581

' NATIONAL COUNCIL FOR HIGHER EDUCATION (NCHE)

ON BEHALF OF MALA WI GOVERNMENT

SKILLS DEVELOPMENT PROJECT IDA PROJECT P131660

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 30 JUNE 2016

5 CASH AND CASH EQUIVALENTS

2016

MK'OOO

NBSFCDA 416,030 NBS Local 25,095 NBMFCDA 1 NBM Local

441 ,126

Bank overdraft (59)

441,067

2016

USD

583,362 35, 188

2

618,552

(83)

618,469

The project did not have a formal overdraft facility as at year end. The overdrawn posision is the result of bank charges.

6 RECEIVABLES

Prepayment 4,873 6,834

7 PAYABLES

Accruals 38,760 54,349

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2015

USO

12,300 22,736

8

630

35 ,674

35,674

33 ,971

8,992

•• GRAHAM CARRii

Chartered Accountants



AUDITOR'S REPORT ON INTERNAL CONTROL FOR THE YEAR ENDED 30 JUNE 2016

We have audited the statement of receipts and payments of Skills Development Project as of 30 June 2016, and have issued a report thereon dated 3rct January 2017.

We conducted our audit in accordance with International Standards on Auditing and International Development Association ' s terms of reference pertaining to external audit. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the statement of receipts and payments is free from material misstatement.

ln planning and performing our audit of the Skills Development Project, for year ended 30 June 2016, we considered its internal controls as a basis of designing our audit procedures for the purpose of expressing our opinion on the statement of receipts and payments .

Our consideration of internal controls was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal controls that might be significant deficiencies or material weaknesses and therefore, there can be assurance that all deficiencies, significant deficiencies or material weaknesses have been identified.

A deficiency in internal controls exists when the design or operation of a control does allow management or employees, in the normal course of performing their assigned functions to prevent or detect and correct misstatement on a timely basis. A material weakness is a deficiency or combination of deficiencies, in internal control , such that there is a reasonable possibility that a material misstatement of the entity ' s statement of receipts and payments will not be prevented or detected and corrected on a timely basis .

In our opinion, internal controls were adequate for the year.

Information contained in this report may be privileged. This report is intended solely for the use of Skills Development Project and the International Development Association but this is not intended to limit the distribution of the report if it is a matter of public record.

Graham Carr y ct January 2017

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I ADL House, 2"d Floor, City Centre I P.0.Box 898 Lilongwe Malawi

Tel: (+265) 01 775 763 I 01 775 764 I 01 775 836. Fax: 01 775 763, E-mail: [email protected] Nexia International is a worldwide network of independent auditors. business advisors and consul tants

Partners: C.M .C Banda-Lilongwe, D. Ngwira(M rs)-Blantyre. Offices in Lilongwe and Blantyre.

•• GRAHAM CARRI I

Chartered Accountants

~ Ne;i~ ~ International



AUDITOR'S REPORT ON COMPLIANCE WITH AGREEMENT TERMS FOR THE YEAR ENDED 30 JUNE 2016

We have audited the statement of receipts and payments of Skills Development Project for the year ended 30 June 2016 and have issued a report thereon dated yct January 2017.

We conducted our audit in accordance with International Standards on Auditing and International Development Association's terms of reference pertaining to external audit. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the statement of receipts and payments is free from material misstatement.

As part of obtaining reasonable assurance about whether statement of receipts and payments is free of material misstatement, we performed tests of compliance with certain provisions of the agreement terms. However, our objective was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion.

Material instances of non-compliance are failures to follow requirements or violations of agreement terms that cause us to conclude that the aggregation of misstatements resulting from those failures or violations is material to the statement of receipts and payments.

We considered these material instances of non-compliance in forming our opinion on the statement of receipts and payments whether they are presented fairly, in all material respects and this report does not affect our report on the statement of receipts and payments dated Jrd January 2017.

In our opinion, the project has complied with the agreement terms.

Financial information contained in this report may be privileged. This report is intended solely for the use of Skills Development Project and IDA but this is not intended to limit the distribution of the report if it is a matter of record.

c~~ Graham Carr 3rd January 2017

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I ADL House, 2"0 Floor, City Centre I P.0.Box 898 Lilongwe Malawi

Tel: (+265) 01 775 763 I 01 775 764 I 01 775 836, Fax: 01 775 763, E-mail: lilongwe~grahamcamnw.com ;,,.;exia International is a worldwide network of independent auditors. business advisors and consultants

Partners: C.M.C Banda-Lilongwe, D. :-.lgwira(Mrs)-Blantyre. Offices in Lilongwe and Blantyre.

NATIONAL COUNCIL FOR HIGHER EDUCATION (NCHE) ON BEHALF OF MALA WI GOVERNMENT

APPENDIX TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2016

DETAILED INCOME AND EXPENDITURE STATEMENT

Income Receipts Interest received Exchange gains

Total income

Expenses Accommodation and hall hire charges Advertising and promotions Audit and risk management expenses Bank services charges Fixed assets and other insurances Fixed assets depreciation Information and communication expenses Licenses, emails and other compliance expenses Licenses, emails and other compliance charges Miscellaneous expenses Motor Vehicle fuels and lubricants Motor Vehicle maintenance expenses Office consumables Printing and stationery expenses Professional fees and charges Subscriptions to various bodies Telephones, faxes and other charges Travel allowances Travel and transportation expenses - other Staff expenses - overtimes and incentives Staff expenses - recruitment expenses Staff expenses - training and development

Capital expenses

Total expenses

Surplus for the year

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2016 MK'OOO

1,095,789 4,737

256,462

1,356,988

27,548 8,997 4,000

804 2,242

46,545 2,718

40 1,051

177 4,678 2,255 3,117

10,516 158,894

249 3,751

46,203 26,392

230 240

26,440

377,086

643,175

1,020,261

336,728

Appendix I

2016 USD

1,957,723 6,941

1,964,664

41 ,680 13,613 6,052 1,216 3,391

70,523 4,112

61 1,590

268 7,077 3,411 4,715

15,910 240,424

377 5,675

69,915 39,930

349 364

40,004

570,660

942,329

1,512,989

451,675

~:=3

.. -NATIONAL COUNCIL FOR HIGHER EDUCATION (NCHE) ON BEHALF OF MALA WI GOVERNMENT SKILLS DEVELOPMENT PROJECT IDA PROJECT P131660

APPENDIX TO THE FINANCIAL ST A TEMENTS FOR THE YEAR ENDED 30 JUNE 2016

FIXED ASSET REGISTER

No Asset name and description Qty Reference Purchase date

Buildings Buildings on Plot 47/2/377 SDP000683 5/11/16

2 Stamp Duty on building transfer SDP000753 6/8/16

3 Lawyer's transfer charges GNN15/149 6/30/16

Plant & Equipment 16 Hisense bar fridges SDP000286 10/29/15 17 Hisense bar fridges SDP000286 10/29/15

18 Hisense bar fridges SDP000286 10/29/15

Total for office equipment

Motor vehicles 5 Toyota Hilux Pickup - 80 SC 7 000163+000294 1/27/15

8 Toyota Corolla - 80 SC 8 )P00033 l/38 l/4 12/21/15

9 Toyota Corolla - 80 SC 9 )P00033 l/38 l/4 12/21/15

10 Toyota Hiace 15 seater minibus · SDP000681 5/1/16

11 Honda XL 125 LKC motocycle · SDP000803 6/28/16

'~ Total for motor vehicles

L

Unit Cost Cost

525,000,000.00 7,875,000.00

30,000,000.00

562,875,000.00

151,800.00 151 ,800.00 151 ,800.00

33,823,984.17 16,916,580.00 16,916,580.00 19,401,504.00 2,660,500.01

- 19 -

-

A endix II

Additions Total Cost Useful Accumulated Net life depreciation book value

525,000,000.00 525,000,000.00 40 12,468,750.00 512,531 ,250.00 7,875,000.00 7,875,000.00 40 187,031.25 7,687,968.75

30,000,000.00 30,000,000.00 40 712,500.00 29,287,500.00

562,875,000.00 562,875,000.00 13,368,281.25 549,506, 718. 75

151 ,800.00 151 ,800.00 10 14,421.00 137,379.00 151 ,800.00 151 ,800.00 10 14,421 .00 137,379.00 151 ,800.00 151 ,800.00 IO 14,421.00 137,379.00

455,400.00 455,400.00 43,263.00 412,137.00

33,823,984.17 5 12,853, 113.98 20,970,870.19 16,916,580.00 16,916,580.00 5 3,214,150.20 13,702,429.80 16,916,580.00 16,916,580.00 5 3,214, 150.20 13,702,429.80 19,401,504.00 19,401 ,504.00 5 3,686,285.76 15,715,218.24 2,660,500.01 2,660,500.01 5 505,495.00 2, 155,005 .01

55,895,164.01 89,719,148.18 23,473,195.15 66,245,953.03

... - -NATIONAL COUNCIL FOR HIGHER EDUCATION (NCHE) ON BEHALF OF MALA WI GOVERNMENT SKILLS DEVELOPMENT PROJECT IDA PROJECT P131660


Ap endix II


No Asset name and description Qty Reference Purchase Unit Cost Additions Total Cost Useful Accumulated Net date Cost life depreciation book value

Office furniture and fittings 85 I .Sm L-shaped executive desk SDP000309 11/20/15 419,500.00 419,500.00 419,500.00 10 39,852.50 379,647.50

86 l .8m L-shaped executive desk SDP000309 11/20/15 419,500.00 419,500.00 419,500.00 10 39,852.50 379,647.50

87 1.8m L-shaped executive desk SDP000309 11/20/15 419,500.00 419,500.00 419,500.00 10 39,852.50 379,647.50

88 I .Sm L-shaped executive desk SDP000309 11/20/15 419,500.00 419,500.00 419,500.00 10 39,852.50 379,647.50

89 I .Sm L-shaped executive desk SDP000309 11/20/ 15 419,500.00 419,500.00 419,500.00 10 39,852.50 379,647.50

90 I .Sm L-shaped executive desk SDP000309 11 /20/15 419,500.00 419,500.00 419,500.00 10 39,852.50 379,647.50

91 I .Sm L-shaped executive desk SDP000309 11/20/15 419,500.00 419,500.00 419,500.00 10 39,852.50 379,647.50

92 1.8m L-shaped executive desk SDP000309 11/20/15 419,500.00 419,500.00 419,500.00 10 39,852.50 379,647.50

93 Executive high-back leather chai SDP000309 11/20/15 165,000.00 165,000.00 165,000.00 10 15,675.00 149,325.00

94 Executive high-back leather chai SDP000309 11/20/15 165,000.00 165,000.00 165,000.00 10 15,675 .00 149,325.00

95 Executive high-back leather chai SDP000309 11/20/15 165,000.00 165,000.00 165,000.00 10 15,675 .00 149,325.00




99 Executive high-back leather chai SDP000309 11/20/15 165,000.00 165,000.00 165,000.00 10 15,675.00 149,325 .00


IOI Standard visitors' chair SDP000309 11/20/15 55,000.00 55,000.00 55,000.00 10 5,225.00 49,775.00

102 Standard visitors' chair SDP000309 11/20/15 55,000.00 55,000.00 55,000.00 10 5,225.00 49,775.00

103 Standard visitors' chair SDP000309 11/20/15 55,000.00 55,000.00 55,000.00 10 5,225 .00 49,775.00

J 104 Standard visitors' chair SDP000309 11/20/15 55,000.00 55,000.00 55,000.00 10 5,225.00 49,775.00

105 Standard visitors' chair SDP000309 11/20/15 55,000.00 55,000.00 55,000.00 10 5,225 .00 49,775.00 i 106 Standard visitors' chair SDP000309 11/20/15 55,000.00 55,000.00 55,000.00 10 5,225.00 49,775.00

107 Standard visitors' chair SDP000309 11/20/15 55,000.00 55,000.00 55,000.00 10 5,225.00 49,775 .00

108 Standard visitors' chair SDP000309 11/20/15 55,000.00 55,000.00 55,000.00 10 5,225 .00 49,775.00



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• - - -NATIONAL COUNCIL FOR HIGHER EDUCATION (NCHE) ON BEHALF OF MALA WI GOVERNMENT SKILLS DEVELOPMENT PROJECT IDA PROJECT P131660


Ap endix II


No Asset name and description Qty Reference Purchase Unit Cost Additions Total Cost Useful Accumulated Net

date Cost life depreciation book value

111 Standard visitors' chair SDP000309 11/20/15 55,000.00 55,000.00 55,000.00 IO 5,225.00 49,775.00

112 Standard visitors' chair SDP000309 11/20/15 55,000.00 55,000.00 55 ,000.00 10 5,225.00 49,775.00

113 Standard visitors' chair SDP000309 11/20/15 55,000.00 55,000.00 55 ,000.00 10 5,225.00 49,775.00

114 Standard visitors' chair SDP000309 11/20/1 5 55,000.00 55,000.00 55,000.00 10 5,225.00 49,775.00

115 Standard visitors' chair SDP000309 11 /20/15 55,000.00 55,000.00 55 ,000.00 10 5,225.00 49,775.00


117 Standard visitors' chair SDP000309 I 1/20/15 55,000.00 55,000.00 55,000.00 10 5,225.00 49,775 .00








125 4-drawer filling cabinet SDP000309 11/20/15 135,000.00 135,000.00 135,000.00 IO 12,825.00 122, 175.00

126 4-drawer filling cabinet SDP000309 11/20/15 135,000.00 135,000.00 135,000.00 IO 12,825.00 122,175.00

127 4-drawer filling cabinet SDP000309 11/20/15 135,000.00 135,000.00 135,000.00 10 12,825 .00 122,175.00

128 4-drawer filling cabinet SDP000309 11/20/15 135,000.00 135,000.00 135,000.00 IO 12,825 .00 122,175.00

129 4-drawer filling cabinet SDP000309 11/20/15 135,000.00 135,000.00 135,000.00 10 12,825.00 122,175.00

130 4-drawer filling cabinet SDP000309 11/20/15 135,000.00 135,000.00 135,000.00 10 12,825.00 122,175.00

131 4-drawer filling cabinet SDP000309 11/20/15 135,000.00 135,000.00 135,000.00 10 12,825.00 122,175.00 r!~ White washboard SDP000309 11/20/15 65,000.00 65,000.00 65,000.00 10 6,175.00 58,825.00

White washboard SDP000309 11/20/15 65 ,000.00 65,000.00 65,000.00 IO 6, 175 .00 58,825.00

134 MR1200 meeting table SDP000310 11/20/ 15 139,800.00 139,800.00 139,800.00 10 13,281.00 126,519.00

135 MR 1200 meeting table SDP000310 11/20/15 139,800.00 139,800.00 139,800.00 IO 13,281.00 126,519.00

136 MR1200 meeting table SDP000310 11/20/15 139,800.00 139,800.00 139,800.00 10 13,281.00 126,519.00

137 MR1200 meeting table SDP000310 11/20/15 139,800.00 139,800.00 139,800.00 IO 13,281.00 126,519.00

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• - -NATIONAL COUNCIL FOR HIGHER EDUCATION (NCHE) ON BEHALF OF MALA WI GOVERNMENT SKILLS DEVELOPMENT PROJECT IDA PROJECT P131660


A endix II


No Asset name and description Qty Reference Purchase Unit Cost Additions Total Cost Useful Accumulated Net date Cost life depreciation book value

138 MR1200 meeting table SDP0003 IO 11/20/15 139,800.00 139,800.00 139,800.00 10 13 ,28 1.00 126,5 19.00

139 MRl200 meeting table SDP000310 11/20/15 139,800.00 139,800.00 139,800.00 10 13,281.00 126,519.00

140 MR1200 meeting table SDP000310 11/20/15 139,800.00 139,800.00 139,800.00 10 13,28 1.00 126,519.00

141 MR 1200 meeting table SDP000310 11/20/15 139,800.00 139,800.00 139,800.00 10 13,281.00 126,519.00

142 MR1200 meeting table SDP000376 12/18/15 139,800.00 139,800.00 139,800.00 10 13,281.00 126,519.00

143 MR 1200 meeting table SDP000376 12/18/15 139,800.00 139,800.00 139,800.00 10 13,281.00 126,5 19.00

144 Executive Desk SDP000378 12/18/15 489,882.50 489,882.50 489,882.50 10 46,538.84 443,343.66

145 Executive Desk SDP000378 12/18/15 489,882.50 489,882.50 489,882.50 10 46,538.84 443,343.66

146 Executive leather swivel chair SDP000378 12/18/15 244,650.00 244,650.00 244,650.00 10 23,241.75 221 ,408.25

147 Executive office leather sofa set SDP000378 12/18/15 844,625.00 844,625.00 844,625 .00 10 80,239.38 764,385.63

148 Executive visitors' chairs SDP000378 12/18/15 75,725.00 75,725.00 75,725.00 10 7,193 .88 68,531.13

149 Executive visitors' chairs SDP000378 12/18/15 75,725.00 75,725.00 75,725.00 10 7, 193.88 68,531.13

150 Executive visitors' chairs 1 SDP000378 12/18/15 75,725.00 75,725.00 75,725.00 10 7, 193.88 68,531.13

151 Standard visitors' chairs 1 SDP000378 12/18/15 54,755.00 54,755.00 54,755.00 10 5,201.73 49,553.28

152 Standard visitors' chairs SDP000378 12/18/15 54,755.00 54,755.00 54,755.00 10 5,201.73 49,553.28






c58 Executive Desk SDP000379 12/18/15 424,900.00 424,900.00 424,900.00 10 40,365.50 384,534.50

159 Executive coffee table SDP000379 12/18/15 103,900.00 103,900.00 103,900.00 10 9,870.50 94,029.50

160 Printer SDP000379 12/18/15 131 ,800.00 131 ,800.00 131 ,800.00 10 12,52 1.00 119,279.00

161 Coffee stool SDP000379 12/18/15 229,500.00 229,500.00 229,500.00 10 21,802.50 207,697.50

162 Executive leather swivel chair SDP000419 1/14/16 203,875.00 203,875 .00 203,875.00 10 19,368.13 184,506.88

Total for office furniture 12,242,475.00 12,242,475.00 1,163,035.13 11,079,439.88

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-NATIONAL COUNCIL FOR HIGHER EDUCATION (NCHE) ON BEHALF OF MALA WI GOVERNMENT SKILLS DEVELOPMENT PROJECT IDA PROJECT P131660



No Asset name and description Qty Reference Purchase date

Unit Cost Cost

Information and Communication Technology (ICT) equipment and accessories Sage ERP300 Finance mgt

31 package 36 42 U Server Rack 37 Server HP ProLiant DL 380P 26

APC 3000 VA Rack mounted 38 UPS

Laptop Dell Inspiron 15 R, 8G B, 55 ITB 57 Hard drives 70 HP ProBook 450G2 i7 laptop 71 HP Laser printer 72 HP 225DN lasejet printer 73 HP 350G I Ci7 laptop 74 HP 350G I Ci7 laptop 75 HP PR0450 G3 i7 laptop 76 HP PR0450 G3 i7 laptop 77 HP PR0450 G3 i7 laptop 78 HP PR0450 G3 i7 laptop

Dell Optiplex 9020 i5 desktop

J 79 computer

Dell Optiplex 9020 i5 desktop \ 80 computer b ' Dell Optiplex 9020 i5 desktop V 81 computer

82 APC 650Y A UPS

>P24+SDP164+! 11 /12/14 SDP000295 1 /23/15 SDP000295 I /23/15

SDP000297

SDP000776 SDP000600 SDP0003 l l SDP000312 SDP000407 SDP000407 SDP000407 SDP000407 SDP000407 SDP000407 SDP000407

SDP000407

SDP000407

SDP000407 SDP000407

1/26/15

3/11/15 5/5/1 5

11 /20/1 5 11/20/15 1/4/16 1/4/16 1/4/16 1/4/16 1/4/16 1/4/16 1/4/16

1/4/16

1/4/16

1/4/16 1/4/16

27,769,314.40 926,524.50

7,515,299.00

980,000.00

693 ,175.00 208,535.00 733 ,950.00 375,414.26 295 ,000.00 795,000.00 795,000.00 795,000.00 795,000.00 795,000.00 795,000.00

685,000.00

685,000.00

685,000.00 70,000.00

- 23 -

Additions

733 ,950.00 375,414.26 295,000.00 795,000.00 795,000.00 795,000.00 795,000.00 795,000.00 795,000.00

685,000.00

685,000.00

685,000.00 70,000.00

-

Total Cost

27,769,314.40 926,524.50

7,515,299.00

980,000.00

693 ,175.00 208,535.00 733,950.00 375,414.26 295 ,000.00 795,000.00 795,000.00 795,000.00 795,000.00 795 ,000.00 795,000.00

685,000.00

685,000.00

685,000.00 70,000.00

A endix II

Useful Accumulated Net life depreciation book value

3

3

3

3

3 3

3

3 3

3 3 3

3

3 3

3

3

3

3

17,587,232.45 586,798.85

4,759,689.37

620,666.67

439,010.83 132,072.17 232,417.50 118,881.18 93 ,416.67

251,750.00 251 ,750.00 251 ,750.00 251 ,750.00 251 ,750.00 251 ,750.00

216,916.67

216,916.67

216,916.67 22,166.67

I 0, 182,081.95 339,725.65

2,755,609.63

359,333.33

254, 164.17 76,462.83

501 ,532.50 256,533 .08 201 ,583.33 543,250.00 543,250.00 543,250.00 543,250.00 543,250.00 543,250.00

468,083.33

468,083.33

468,083.33 47,833 .33

-

- -NATIONAL COUNCIL FOR HIGHER EDUCATION (NCHE) ON BEHALF OF MALA WI GOVERNMENT SKILLS DEVELOPMENT PROJECT IDA PROJECT P131660


A endix II


No Asset name and description Qty Reference Purchase Unit Cost Additions Total Cost Useful Accumulated Net

date Cost life depreciation book value

83 APC 650V A UPS SDP000407 1/4/16 70,000.00 70,000.00 70,000.00 3 22, 166.67 47,833.33

84 APC 650V A UPS SDP000407 1/4/16 70,000.00 70,000.00 70,000.00 3 22,166.67 47,833.33

Sony DX147 3200lm wireless

85 projector SDP000407 1/4/16 595,000.00 595,000 .00 595,000.00 3 188,416.67 406,583.33

Sony DX 14 7 32001m wireless

86 projector SDP000407 1/4/16 595,000.00 595,000.00 595,000.00 3 188,416.67 406,583.33

87 Laser pointer SDP000407 1/4/16 45,000.00 45,000.00 45,000.00 3 14,250.00 30,750.00

88 Laser pointer SDP000407 1/4/16 45,000.00 45,000.00 45,000.00 3 14,250.00 30,750.00

89 1 TB USB external hard drive SDP000407 1/4/16 78,000.00 78,000.00 78,000.00 3 24,700.00 53 ,300.00



92 I TB USB external hard drive SDP000407 1/4/16 78,000.00 78,000.00 78,000.00 3 24,700.00 53 ,300.00




96 1 TB USB external hard drive SDP000407 1 /4/16 78,000.00 78,000.00 78,000.00 3 24,700.00 53,300.00



99 Projector screen tripod 200x200 SDP000408 1/5/16 193,256.90 193,256.90 193,256.90 3 61 ,198.02 132,058 .88

J 100 Projector screen tripod 200x200 SDP000408 1/5/16 193,256.90 193,256.90 193,256.90 3 61 ,198.02 132,058.88

~ 105 Nikon 03300 digital camera SDP000807 2/28/16 410,429.50 410,429.50 410,429.50 3 129,969.34 280,460.16

C06 Nikon 03300 digital camera SDP000807 2/28/16 410,429.50 410,429.50 410,429.50 3 129,969.34 280,460.16

Total for ICT equipment & accessories 11,706,737.06 49, 799,584.96 27 ,832,603. 7 4 21,966,981.22

Grand total 643,174,776.07 715,091,608.14 65,880,3 78.26 649,211,229.88

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national council for higher education...

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